A Samsung Galaxy S7 Edge mobile phone is displayed during a preview of Samsung's flagship store, Samsung 837, in New York's Meatpacking District, Monday, Feb 22, 2016. Samsung is opening what it calls a "technology playground" in New York for customers to check out its latest gadgets. The center opens Tuesday, the day Samsung starts taking orders for its upcoming Galaxy S7 and S7 Edge phones. (AP Photo/Richard Drew) (AP)

Samsung executive of massive Galaxy Note 7 recall: It will cost company "a heartbreaking amount"

In its haste to beat Apple iPhone 7 to the market, Samsung might have just shot itself in the foot


Scott Eric Kaufman
September 6, 2016 4:12PM (UTC)

When asked about the potential impact of the massive Galaxy Niote 7 recall, the head of Samsung's mobile business, Koh Dong-Jin, said that was likely to cost the company "a heartbreaking amount."

Dong-Jin was not just referring to the recall itself, which is likely to cost the company an estimated $4 or $5 billion -- Samsung's overall revenue in 2016 is projected to exceed $20 billion in 2016 -- but in the market advantage it hoped to gain by releasing the Galaxy Note before the iPhone 7 entered the market.

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Whatever competitive advantage it gained through haste, however, has been lost due to units that explode while charging. Insiders speculate that the faulty battery could even be the unintended consequence of said haste, inasmuch as Samsung pressured its subcontractors to push schedules and, possibly, the limits of their manufacturing potential.

Apple is already poised to profit off Samsung's misfortune, alerting its suppliers to increase their rates of production in order to take advantage of the currently extant gap in the cutting-edge smartphone market. That is, of course, if it can keep its rushed-market-model from spontaneously combusting.


Scott Eric Kaufman

Scott Eric Kaufman is an assistant editor at Salon. He taught at a university, but then thought better of it. Follow him at @scottekaufman or email him at skaufman@salon.com.

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